S&P rates AES Gener notes BB+

Standard & Poor's said it assigned its preliminary BB+ rating to AES Gener SA's proposed $300 million long-term Rule 144A bonds to be issued in March.

Upon successful issuance of the bonds, S&P said it expects to remove the company's B corporate credit rating from CreditWatch and raise the rating to BB+ with a stable outlook. The current CreditWatch positive status reflects the potential success of the company's debt restructuring plan.

S&P said AES Gener's current B ratings are mainly driven by its weak financial profile, particularly marked by high refinancing risk. AES Gener's credit ratings had deteriorated over the past two years in light of the company's challenges to meet debt maturities in 2002 and 2003; its restricted access to credit sources; and its weak liquidity position to meet significant maturities, especially in March 2005 and January 2006.

S&P said the preliminary BB+ rating reflects the projected significant improvement of the company's financial profile resulting from a debt restructuring plan that is expected to reduce consolidated debt by $300 million from almost $1 billion as of December 2003 (excluding its Colombian subsidiary, Chivor) and significantly extend the average life of the company's debt.

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